Phase 2 of Strategic Budget Initiative

We are addressing the financial strain that is being experienced in the higher education industry head-on by engaging in a holistic, university-wide budget realignment and growth initiative that will enable us to shore up our short-term and long-term financial health while also delivering on our mission to our students. We began this work in November 2022, and it will continue through fiscal year 2023-2024 (planning), fiscal year 2024-205 (implementation), and likely for the next few years.

These efforts will enable us to shore up our short-term and long-term financial health and grow our enrollment so that we can serve our students even more effectively and make education work for all.

Higher education institutions, especially public universities, are facing significant internal and external pressures. CU Denver is not immune from these financial realities, which have created the need for near-term and longer-term budget reductions as well as a renewed focus on enrollment and revenue growth. Some of the factors impacting finances include:

• We have not met our enrollment targets in recent years even as we've worked hard to buck national and regional enrollment trends.
• We have kept tuition and fees affordable at CU in the interest of our students and families.
• State funding for research institutions has not kept up with inflation.
• We are committed to paying our employees competitively and equitably, including merit increases in January 2023 and beyond.
• Our costs for employee benefits and other campus costs keep increasing.
• Inflationary and economic pressures continue to have impacts.

We will continue to be proactive, as we are with this initiative, in explaining to the community and putting into practice the tenets of good financial health: growing at a faster rate than we are spending, being mindful of uncertain economic conditions and mandated costs, and being strategic in how we invest our money. Our budget office is always looking ahead at trends and projections, but it is too soon to predict exactly where we will land in upcoming fiscal years because there are too many uncertain variables. That noted, preparing for good financial health now will help us build good practices and financial strength over time.

To ensure we identify strategic ideas that most advance the commitments made in the university’s 2030 strategic plan, we developed principles that were validated by our community in February 2023. These principles will remain in effect for Phase 2.

• Prioritize student success and necessary supports
• Prioritize our people and their hard work
• Prioritize DEI and the continued equity-serving nature of our work
• Value systems thinking, nimbleness and an institutional mindset
• Remember our fiduciary responsibility as stewards of public funds and students’ tuition dollars

At the outset of this strategic enrollment and budget initiative and in keeping with our strategic plan, we have set quality education (teaching, learning, and student support) as the most important priority for CU Denver. In 2023, administration made larger percentage larger cuts compared to the academic side of the house and will continue to stand with schools and colleges in this effort. We continue to ask for holistic, coordinated proposals from administrative units, and schools, and colleges, which will help us make the best decisions we can. In addition, this time, we will offer one time incentives to spur program growth across the schools and colleges because we know that cutting alone will not enable us to reach our financial and mission-driven goals; we must grow our enrollment in order to be successful.

We have intentionally created guiding principles for the budget realignment initiative to prioritize teaching, learning, student support, and equity. In a budget-constrained environment, the greatest challenge is that we don’t have enough money to fund everything, but we have brought our community together for this process to help make the best recommendations and decisions as possible with our guiding principles to help us make those decisions.

No. In fact, our strategic planning work is the most important way to create a more sustainable, impactful, and financially healthy institution. If we are strategic about our work, we should be able to reasonably map out our strategic goals with an identified funding mechanism as we move forward. Still, some initiatives may take a little longer to achieve because we will need to pay for them with ongoing dollars. We cannot hope to pay for things with one-time funds that are not guaranteed beyond the first year. The teams who are working on about 50 strategic planning initiatives in fiscal year 2023-2024 are being asked to carefully consider timelines, budget, and resources, with clear direction to keep projects moving and adjust as needed.

Throughout academic year 2022-2023, we received more than 50 ideas on potential ways to reduce expenses and/or bring innovation to the university to grow. These ideas ranged from closing buildings when not in use to cutting back on technology expenses. We previewed these ideas with leaderships (including shared governance leaders) in May 2023 and communicated at the time that business analysis of these ideas was underway. After initial analysis, these ideas fell into a few different categories: 1.) They wouldn’t result in meaningful cost savings or they would require further resources investment to achieve; 2.) We can’t implement them because the decisions are not owned at the local campus level (i.e. they involve AHEC, the CU System, or CU Anschutz); 3.) The ideas require more comprehensive and long-term analysis that we cannot accommodate right now. All and all, we will maintain a running list of these ideas, but none of them can be considered for Phase 2 implementation.

We are working toward an overall budget reduction of about $5 million, which represents approximately 2.6% of our total unrestricted budget minus campus-wide mandatory expenses. We are asking both the administrative and academic sides of the house to cut 2.6% each. Originally, for Phase 2, we anticipated a 4% reduction for administration and a 4% reduction for schools and colleges. However, strong financial planning, higher-than-anticipated state support in FY 2023-24, and the hard work on the part of the CU Denver community in the first phase has lessened the total reduction amount.

The $5 million will cover our enrollment shortfall ($3 million+); help to insulate us from future fluctuations in enrollment, state funding, and mandatory expenses; and provide some cushion for us to invest in academic programs and recruitment and retention efforts aimed at growth.

While some initial pre-work of evaluating pre-submitted ideas began in spring/summer 2023, Phase 2 will formally kick off in early October 2023 and will wrap up before June 30, 2024. Similar to last year, initial proposals will be due in Winter 2023/2024; decisions will be made by April 2024; and accepted proposals will be implemented on July 1, 2024 (FY 2024-25). Leadership, including shared governance leaders, will be consulted throughout the process, and we are once again asking Cabinet members and deans to ensure a collaborative process for information sharing within their units.

In Phase 1, we asked all schools, colleges, and units to contribute budget reductions, with administration taking a 4% reduction and schools and colleges, 3%. In Phase 2, schools, colleges, and units will need to make additional 2.6% cuts (as described above); however, much of our focus will be on identifying cross-unit ideas and transformational shifts that allow us to become more strategic in our enrollment approaches and practices and our resource use at the institutional level.

We are introducing two new offerings in Phase 2: 1) a campuswide voluntary faculty/staff retirement incentive program to allow community members to make career or life changes that are right for them while giving the university greater financial flexibility; and 2) We are considering ways to support academic program growth and retention in areas where it makes the most sense. To be successful, we need to grow—not simply cut—our way to long-term financial health, and these investments are one way to help achieve that. Additional information will be available later in the fall.

At the end of fiscal year 2022-2023, we set aside unused salary savings and operating budgets to create a pool for strategic investments.

Every member of the CU Denver community contributes to the mission of the university and has a role to play in student success and our financial future. We invite members of the community to frequently check our dedicated project website; read all-campus emails on this topic; and participate in information sessions hosted by the budget planning team. Additionally, faculty and staff are invited to participate in the processes established within their own schools, colleges, and units. We need broad participation from faculty, staff, and students to reach our 2030 vision.

Continue to visit the website for this project and check your email for updates and invitations to participate.

Yes. Once all proposals have been reviewed, vetted, and approved, we will create a dashboard on our project website similar to last year.

We have decided to suspend the campus incentive-based budget model while we move through our strategic enrollment and budget initiative. The process that we are going through now is taking its place as we work together as a community to establish budgets for our administrative and academic units that align with our priorities. In the event that our enrollment exceeds the budgeted levels and we have brought in total revenue over what we expected, we will allocate this out to the academic units to reward the growth.

Similar to Phase 1, Faculty Assembly, Staff Council, and Student Government Association leaders will continue to participate in briefings and consultations throughout the process, including receiving the full suite of proposals submitted by schools, colleges, and units once they are generated and vetted.

There is not a hiring freeze, and there are no plans for furloughs. However, for vacancies, there are other considerations. For example, if faculty depart or retire in departments where there is historic shrinking enrollment, this may lead to faculty lines not being replaced or not being replaced in the same way. In administration, some positions may shift or be eliminated following departures, retirements, or process improvements that lead to efficiencies. In some cases, critical academic and administrative positions may be refilled. We need to carefully consider each position on a case-by-case basis.

We are not anticipating widespread layoffs as part of the budget process. Rather, across some units, there could be reorganizations that result in a few position eliminations or modifications. Sometimes, reorganizations are necessary to adapt how we work to the current environment so that we can be most effective with the resources we have while planning for longer-term growth and agility. 

 

In areas that may be affected by reorganization and possible position eliminations, we will work to provide ample notification and resources to assist with the transition. 

At this time, there is no intention of canceling all travel. Each school, college, and administrative team will need to carefully evaluate what must continue and how, with an understanding that travel should advance our strategy and not conflict with our budgetary constraints. We are asking leaders to be judicious in their evaluation of what is needed and what will advance our strategic plan.

Yes. Like travel and vacancies, we are asking schools, colleges, and administrative units to review carefully and critically what is being offered and use good judgement.

No. Goal 1 of our strategic plan is to become the nation’s first equity-serving institution, and we take that commitment and responsibility seriously. Schools, colleges, and units will be asked to consider DEI as part of their decision making and leverage their departmental/unit DEI plans as an important reference point.

No. As with everything else, we need to look at budgets judiciously but, if our goal is to attract and retain more students at CU Denver, advertising, storytelling, and a strong brand and web presence are contributors to this aim. With respect to our branding efforts, we are completing this work in-house.